While the accessories industry is still reeling from Donald Trump’s proposed 10% tariff on Chinese goods, the news just got worse…

The president is doubling down on his China Trade War stance, proposing to replace the 10% tariff with a 25% one on $200 billion of Chinese goods. Talks between Washington and Beijing remain at a standstill, and this escalation is an effort to force China to the negotiating table and abandon its retaliatory tariffs against the U.S.

“This week, the President has directed that I consider increasing the proposed level of the additional duty from 10 percent to 25%. The 25% duty would be applied to the proposed list of products previously announced on July 10,” U.S. Trade Representative Robert Lighthizer said in a statement to CNBC. “The Trump Administration continues to urge China to stop its unfair practices, open its market, and engage in true market competition. We have been very clear about the specific changes China should undertake. Regrettably, instead of changing its harmful behavior, China has illegally retaliated against U.S. workers, farmers, ranchers and businesses.”

Handbags and other accessories like hats and ponchos remain in the crosshairs, and while manufacturers are all about Made in America in theory, the reality is that production costs forced them overseas years ago. One solution would be to shift production from China to another country, but that obviously takes time and there are Holiday goods in the pipeline that have already been ordered by retailers. The result? Manufacturers would have to absorb any price hike. In the end, the consumer will lose, as increased costs will ultimately get passed along to them.

“[This] will cause significant pressure on vendor and retailer (for direct programs) margins because of the expected and immediate date of the tariffs being imposed,” says Drew Pizzo, President of Collection 18, which manufacturers fashion accessories and handbags. “Had the original 10% tariff been proposed, planned, and implemented in 6 months or more there would have been an opportunity to negotiate and appropriately price our merchandise. Few of us have the ability to shift production to non-tariff countries overnight.”

The “little guys” will be the most hurt, as they would lack a strong balance sheet to offset such setbacks in an already challenging time.

The only bright spot in this news is that the administration has announced an extension of the public commentary period from August 30th to September 5th, giving industry members more time to make an appeal to keep the tariffs at bay.

Giberson had the Accessories Council’s 300 members in mind when she filed a request to testify in Washington DC at a public hearing to oppose the $200 billion in retaliatory duties on Chinese exports (ironically, the request was filed when the proposed tariffs were at 10%; now they are at 25% raising the concern…and the urgency). The list includes handbags, small leather goods, real and faux fur, many types of hats, and plastic apparel like ponchos.

“We are encouraging companies to reach out so we can build the most compelling possible case. We will fight fiercely, but we need as much ammunition as possible.”–Karen Giberson, President, Accessories Council

If Giberson’s request is granted, she will appear before a panel of United States trade representatives in Washington. She will present testimony she’s collected on how the tariffs would harm the industry.

“The written testimony for our appeal is due by midnight on August 9. It’s not too late to send your story,” says Giberson. “We are encouraging companies to reach out so we can build the most compelling possible case. We will fight fiercely, but we need as much ammunition as possible. Reach out with questions or for the questionnaire.”

The Accessories Council, National Retail Association (NRF), American Apparel and Footwear Association (AAFA) and Retail Industry Leaders Association (RILA) have all come out strongly against additional tariffs, and the industry waits to see if their efforts to negotiate with Washington for exclusion of our products from the proposed list will be successful.